Investing in the development of your products and services is crucial for achieving positive market growth and for making your reputation comparable to that of market leaders. That said, all your financial efforts will be in vain if you don’t also prioritize the financial recordkeeping procedures required in order to maintain an accurate record of transactional data. One of the biggest mistakes you can make, as an FL-based company, is to not focus on the proper storage of your venture’s financial data, and make yourself vulnerable to external audits.
Bookkeeping, at the end of the day, represents the only way to positively influence the decision-making processes effectuated by your firm’s upper management, and gain a clear understanding of the metrics required for obtaining a clear view of your company’s financial data. Proper bookkeeping is a way to prepare your transactional data for external audits, keep in check with the fiscal regulations active for FL-based companies, reduce the workload of your internal teams and also identify financial pitfalls that negatively impact your investment budget.
There’s an issue, though. The complexity of the financial tasks expected from your employees will quickly surpass their professional abilities and also limit the attention they can give to the departments of your venture that need their core competencies. Outsourced bookkeeping services in Orlando might not have been your priority when you first started your business. But in the long run, they can prove to be one of your organization’s strategic pillars and provide your CPA with the necessary data to positively impact your firm’s financial development framework.
Why Consider Local Bookkeepers in Orlando?
After you reach a certain level, personally handling your firm’s bookkeeping requirements will become impractical. It’s one thing to catalog one or three transactions per day, and it’s something else entirely when you are dealing with dozens of financial entries per hour. Therefore, like the vast majority of businesses active in Orlando, you will have a choice to make. You either invest in hiring a new, internal accounting team, or you go for professional outsourced bookkeeping services in Orlando.
Now, it cannot be denied that internal workers have their own set of benefits. You will gain full, round-the-clock control over their operations, and you will have a direct line of response in case you are confronted with emergencies that require prompt intervention. Internal workers are better if you need someone who can provide round-the-clock bookkeeping support, regardless of the occasion. But there are also downsides.
Full-time employees are more expensive than outsourced bookkeeping services and their work will not be as scalable, at least not without experiencing financial penalties. With local bookkeepers, you will pay a fixed monthly subscription for the services contracted, whose price will be determined after a full audit. Do you want to downscale the services of local bookkeepers in Orlando? That shouldn’t be a problem. But how can you do this with internal workers? You will still need to pay for their salaries, regardless of the external circumstances affecting your firm. From a financial point of view, outsourced bookkeeping services are more advantageous and therefore, it is no wonder that their popularity in Florida is on an ascending trend.
It Can Be a Crucial Business Decision
Florida is not exactly the easiest state to navigate when it comes to the fiscal responsibilities of locally present SMEs. The corporate income tax rates varied in the last couple of years, and the penalties applicable by the DOR for missing sales tax payments or omissions in the submitted paperwork are significant. The Department of Revenue could, for example, apply a 10% penalty for the late payments of your state returns, and these penalties could accrue up to a maximum value of 50%.
Likewise, if errors in bookkeeping resulted in underreporting, you can be penalized with 10% for every month in which your taxes remain unpaid. It’s true that the DOR can waive penalties for reasonable and proof-backed causes. But mistakes in bookkeeping procedures don’t really fit the bill. One mistake in your financial recordkeeping procedures might not exactly result in the bankruptcy of the business you lead. But, multiple errors in a short amount of time? That can have a tremendous effect on the ROI of your offerings and make it close to impossible to attract external investors, something which, unfortunately, sounds painfully familiar.
The Perspective of an Orlando-Based Venture
Five years ago, two of my friends and I decided to open a small retail space, close to Tangelo Park. The area was good enough, our marketing was on point, and we managed to pool together around $50,000, which we used to purchase work equipment, secure our rent and purchase stock for the products we wanted to commercialize. Since business was slow at the beginning, we handled the financials of the firm in-house, with Excel, and we didn’t bother with external help.
But it all went sideways around six months after we started the business, when we discovered we had around $12,000 in sales, but our expenditure for the month was close to $15,000. Some of the invoices sent out got lost, and we didn’t pay a supplier payment that was close to $2,000, which, of course, resulted in late fees being applied. Plus, later in that year, we overpaid our taxes by around $1,000 because we misclassified some of our expenses. By the end of 2021, therefore, we were running on a deficit, and we struggled to keep an accurate ledger of payables and receivables.
It all culminated with a business loan application that took around two weeks to finally result in a negative response. We then decided to hire a CPA and local bookkeepers. It was a financial commitment, but the end result was that we managed to cut down on unnecessary spending by more than 17%, which saved us close to $1,800 per month. Additionally, with the help of the bookkeeper and the CPA, we even recovered a couple of hundred dollars in missed deductions. It wasn’t something we planned for. But ultimately, the services of the bookkeepers we hired managed to pay for themselves.
